South Korea’s LG has recently announced that it will be stepping out of the solar panel manufacturing business over the coming months. Much of the reasoning behind this decision is down to increased costs of materials and logistics due to the pandemic. There had been rumours that LG may be decreasing their solar panel manufacturing output, but the board of directors have now made the decision to withdraw completely.
Rising costs behind the move
Ultimately, the rising costs caused by the pandemic have made it difficult for LG to see a way to continue manufacturing and supplying solar panels around the world. Polysilicon, in particular, is a key component of solar panels and the costs have been rising over the last couple of years. In addition, copper and aluminium prices have been increasing, further adding to the strain for solar panel manufacturers.
It’s not just the cost of materials though, with freight costs also rising to around 7 times the amount pre-pandemic. In combination, these rising costs have forced LG out of the game, especially as they were already a premium product with high retail costs.
Warranties remain intact
The good news for solar customers with LG panels on their rooftops is that all warranties will be honoured. LG has announced they will be standing by the limited warranty on all solar panels, some of which are covered for 25 years. For this reason, LG is keeping a huge supply of solar panels in warehouses in the event of warranty claims.
Fortunately, LG panels have a good reputation for being reliable and durable, so it’s anticipated not many customers will be affected.
LG to remain in the solar industry
While stepping away from solar panel production, LG will still be focusing on other renewable growth areas such as battery storage and home energy management. While it’s disappointing that they aren’t continuing with panels, it’s a positive sign that the global giant still remains committed to solar and renewables to some extent. LG’s solar batteries have always been popular in Australia, so this trend should continue, at least in the immediate future.
Contact Halcol Energy today
Halcol Energy chooses the products it installs very carefully, only working with the most reliable brands from around the world. It’s important to us that our customers have peace of mind when investing in solar energy. If you’d like to discuss your energy needs, contact Halcol Energy today and we’ll be happy to organise an obligation-free energy assessment.